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Your information is secure. Product liability
Cover a product company sells when it damages someone’s property, cause bodily paint to someone or makes them sick. It is most useful with manufacturers, distributors, retailers, and restaurant owners.
What is product liability insurance?
Product liability insurance protects businesses against the cost of a lawsuit, if a customer claims a product the business sold or manufactured led to an injury or property damage.
As a business owner, you face risks every day just by delivering your professional services. Professional liability insurance can help protect you from these risks.
When does a business need product liability insurance?
Product liability insurance protects businesses against lawsuits related to their products.
If you’re a manufacture you should invest in this coverage to guard against lawsuits over your products.
Even if your business does nothing wrong, you could still be sued over a product defect in an item you sold or find yourself responsible for legal defense costs in a frivolous suit. A customer could also claim that your business provided insufficient warnings or inaccurate instructions related to your product.
Product liability protects against items made or sold by you and:
Damaged someone’s property
Property damage caused by a product.
Injured someone
Product liability insurance can cover:
Injury caused by a product
If an item that you sell or manufacture leads to a product injury lawsuit, product liability insurance can cover the cost of hiring an attorney. It would also cover the resulting settlement or court-ordered judgment. Product liability insurance covers lawsuits from customers as well as bystanders.
Property damage caused by a product
Product liability insurance provides coverage when an item you sell or manufacture damages a customer’s property. The damage could be related to a product defect.
Illness caused by a product
This policy protects against illnesses caused by products sold or manufactured by your business.
Wrongful death caused by a product
Product liability insurance also covers lawsuits, burial costs, and other expenses related to a death caused by your product.
Product liability insurance does not cover:
Product recall costs
Product recall insurance covers the cost of recalling a defective product. We can assist with those type of coverage, so do not hesitate to contact us.
Damaged products
The commercial property insurance included in a business owner’s policy protects your own business property from theft and damage. It also covers lost inventory.
Employee injuries
If an employee is injured by a product sold or manufactured by your business, workers’ compensation insurance would cover the employee’s medical bills. It would also cost your legal costs if the employee sues over the injury, but product liability will not cover this.
Accidents involving customers
General liability insurance protects against common third-party (non-employee) accidents, including slip-and-fall injuries at your business and customer property damage.
Is product liability insurance required by law?
You are not required by law to purchase product liability insurance, which is usually included in a general liability insurance policy that many landlord required to open for business. This type of insurance helps you after you’re operating, generating revenue, sells and a hiccup occurs after stable run.
What does product liability insurance cover?
Product liability insurance covers risks related to products your business sold or manufactured. That includes bodily injury, wrongful death, and property damage caused by a product.
Do businesses that don’t manufacture products need product liability insurance?
In states with strict liability laws, a business can still be held responsible for damages even if it did nothing wrong. In terms of product liability, that means retailers that sell defective products, could potentially be held liable for injuries or property damage caused by the product. That’s why product liability insurance is a key policy for any business that deals in products.
Does product liability insurance cover product recalls?
Product liability insurance does not cover the cost of recalling a product. However, it will help pay for legal costs if your product is recalled after a customer is injured. To cover product recalls, you’ll need to add a product recall insurance rider to your general liability policy.
Does product liability insurance cover defective products?
Product liability insurance protects your business from customer injuries and property damage caused by defective products. That includes design defects, manufacturer defects, and marketing defects.